Global positioning system to manage risk for POS terminal

Abstract

The present teachings describe a system for processing financial transactions. In one embodiment, the system includes a remote terminal adapted to identify the location of financial transactions via global positioning system (GPS) information such that the remote terminal acquires transaction information from a user and transmits a first signal indicative of transaction information and GPS information. In addition, the system includes an authorizing host adapted to receive the first signal transmitted by the remote terminal such that the authorizing host evaluates the risk associated with financial transactions based, at least in part, on the GPS information so as to determine whether to accept or decline the financial transaction. The present teachings further describe devices and methods of acquiring GPS information for the purpose of managing risk for financial transactions.

Description

BACKGROUND OF THE INVENTION[0001]1. Field of the Invention[0002]The present invention relates to financial transactions and, in particular, to a system and method of risk assessment, whereby global positioning system (GPS) information is acquired for validation of financial transactions.[0003]2. Description of the Related Art[0004]A typical financial transaction involves a form of payment in exchange for goods and services at a point of sale. In most instances, a customer provides the form of payment, such as a check draft or credit card requisition, to a merchant in exchange for the goods and services. The check draft and the credit request are often regarded as non-cash promissory payments that instruct the customer's bank or credit guarantor to pay the merchant the amount requested by the customer. In some situations, the funds promised to the merchant by the check draft or credit request may not be paid due to reasons such as insufficient funds in the customer's checking account...

AI Technical Summary

Benefits of technology

The patent describes a system and method for processing financial transactions using a remote terminal that identifies the location of a transaction and acquires information about a proposed payment. The system includes an authorizing host that evaluates the risk associated with the transaction based on the location information and determines whether to accept or decline the payment. The host then sends a signal back to the remote terminal indicating the decision. The technical effect of this system is to improve the accuracy and efficiency of financial transactions by identifying and assessing risks associated with them in real-time, and facilitating the decision-making process for both the remote terminal and the host.

Problems solved by technology

In some situations, the funds promised to the merchant by the check draft or credit request may not be paid due to reasons such as insufficient funds in the customer's checking account, account delinquency, or fraud.

As a result, the merchant may be susceptible to risk when a check draft or credit card requisition is received as payment for goods and services.

In some areas, the likelihood that a proffered promissory payment will not be backed by sufficient funds, or will be otherwise fraudulent, is increased.

However, many of these transaction devices are portable and merchants may physically move their store location or the location of the transaction device.

In this circumstance, the risk factors of accepting a proffered promissory payment may have changed as a result in the change in location without the risk assessment agency being aware of the change.

One particular circumstance where this problem occurs involves travelling merchants.

In these circumstances, the risk of accepting checks or other proffered promissory payments can vary quite significantly based on location and the risk assessment agency generally does not have the ability to determine where the travelling merchant is located.

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